Economic impact of reduced state trauma mortality on lifetime personal income and state tax revenue

Abstract

Background

In 2003, Georgia’s trauma mortality rate was 16% above the national average. By 2020, mortality had decreased to 6% below the national average, translating to 1,803 fewer lives lost than might have been expected if 2003 trends had continued. The purpose of this study is to assess the state-wide economic impact of reduced mortality and disability measured in the amount of lifetime personal income and state tax revenue preserved.

Methods

Using the Centers for Disease Control and Prevention’s Web-Based Injury Statistics Query and Reporting System database, state/national trauma mortality rates for 2020 were compared with 2003. Years of potential life lost (YPLL) for trauma victims up to 65 were calculated for the same time period. Rates of severe disability were calculated based on the average results of four studies (1992–2022) and used to estimate additional YPLL. The per-capita personal income for Georgia and the average percent of personal income paid in state taxes were calculated using federal and state data. These numbers were then multiplied by state YPLL rates to calculate lifetime personal income and state tax revenue lost due to trauma.

Results

$4.3 billion in lifetime personal income preserved (averted death $1.3 billion and averted disability $2.9 billion). $508 million in lifetime tax revenue preserved (averted death $158 million and averted disability $349 million).

Conclusions

Reduced state trauma mortality and disability substantially benefitted lifetime potential personal income and lifetime potential state and local tax revenue. This study provides states with a template to evaluate the economic impact of reducing trauma mortality. While the causes of reduced mortality are manifold, anything that can be done to reduce trauma mortality is a worthwhile investment. Accordingly, state trauma system funding should be considered an investment, not a cost.

Level of evidence

Economic and value-based evaluations, Level III.

WHAT IS ALREADY KNOWN ON THIS TOPIC

• Trauma imposes significant economic costs on society, contributing to mortality, disability, loss of productivity, and rising healthcare costs.

• While some research assesses the economic impact of reduced mortality, state-wide assessments are not commonly performed for trauma.

• It is even more rare to find assessments of the economic benefits provided by existing trauma systems to taxpayers and state governments.

WHAT THIS STUDY ADDS

• Demonstrates that decreasing mortality and disability has a significant, positive impact on lifetime personal income and state tax revenue.

• Provides a template and methodology that may be used by other states to evaluate the economic impact of decreasing mortality and disability using publicly available data.

• Emphasizes that state trauma system funding is an investment, not a cost.

HOW THIS STUDY MIGHT AFFECT RESEARCH, PRACTICE OR POLICY

• Our methodology empowers trauma care advocates to show state legislators and policy makers the potential economic returns from investing in new programs and policies which may reduce trauma mortality or evaluate return on investment of current programs.

• Likewise, these data offer a path to expand public awareness of the benefits of trauma care and to educate the public on the high costs of not investing in trauma systems.

Background

A broad category which includes everything from motor vehicle crashes and falls to gun violence and drug overdoses, trauma especially impacts Americans in the prime of their lives. Unintentional injury was the fourth leading cause of death for all Americans in 2020 and was the leading cause of death for those aged 1–44.¹ Trauma thus imposes significant economic costs on society, contributing to disability, loss of productivity, and rising healthcare costs. The Centers for Disease Control and Prevention (CDC) estimates that traumatic injuries cost the American economy roughly $4.2 trillion in 2019 as a result of medical and administrative costs, lost wages and productivity, declining quality of life and earning potential, and foregone tax revenue.² Over half of this cost ($2.4 trillion) was associated with injuries to working age Americans, those 20–64 years old.²

Our analysis focuses on the state of Georgia, a large state of nearly 11 million people with a bustling economy and nationally-representative earning potential. In 2003, Georgia suffered from a trauma mortality rate 16% above the national average. By 2020, Georgia’s trauma mortality rate had decreased to 6% below the national average, which was a global improvement affecting all population groups. It would be reasonable to expect that reduced mortality would result in a positive economic impact. The purpose of this study is to assess the state-wide economic impact of reduced mortality and disability measured in the amount of lifetime personal income and state tax revenue preserved.

Methods

Assessing the cost of trauma in 2020

Using the CDC’s Web-Based Injury Statistics Query and Reporting System (WISQARS) database, state and national trauma mortality rates for 2020 were determined and compared with 2003. Years of potential life lost (YPLL) up to 65 were calculated for the same time period from the same database. The under-65 YPLL reveals the number of years under the age of 65 a person died—a child who died at the age of 2 would have a YPLL of 63, while a patient who died at 66 would have a YPLL of 0. The CDC estimates that in 2020, Georgia’s under-65 YPLL as a result of trauma mortality was 171,702.¹

To calculate the economic costs of trauma, lifetime personal income and state tax revenue were chosen as operative variables. Using data from the Federal Bureau of Economic Analysis, the average per-capita income for Georgia in 2020 was determined to be $51,967.³ Given a lack of data on the socioeconomic status of trauma victims, average per-capita income was used to account for a mixed population comprising indigent and affluent trauma patients. Per-capita income was multiplied by Georgia’s 2020 YPLL to calculate lifetime potential personal income lost due to trauma mortality. This approach was used to conservatively estimate the effects of trauma costs, as it assumes no income or economic productivity occurs after the age of 65.

Georgia collected an average of 11.8% of personal income as state and local taxes in 2020.⁴ This tax rate was multiplied by the lost lifetime potential personal income to calculate the cost of trauma to state and local tax revenues.

Mortality-Associated Costs

Lost Lifetime Potential Personal Income=YPLL×Per-Capita Income

Lost State and Local Tax Revenue=Lost Personal Income×State and Local Tax Rate

In addition to costs associated with mortality, we also assessed costs associated with severe disability as a result of trauma. We define severely disabled individuals as those incapable of returning to work or otherwise productive lifestyles after a traumatic injury. Rates of severe disability were calculated based on the average results of four studies and used to estimate additional YPLL at a ratio of 2.2 severely disabled individuals per trauma death.5,8

Disability-Associated Costs

Lost Lifetime Potential Personal Income (Disability)=2.2×Lost Lifetime Potential Personal Income (Mortality)

Lost State and Local Tax Revenue (Disability)=2.2×Lost State and Local Tax Revenue (Mortality)

The total economic costs of trauma to Georgia’s economy in 2020 can be determined by summating the costs of mortality and severe disability.

Total Cost of Mortality and Disability

Total Costs=Mortality-Associated Costs+Disability-Associated Costs

Assessing the impact of reduced mortality

To assess the impact of reduced mortality, Georgia’s trauma mortality rate relative to the national average in 2020 was compared with its mortality rate relative to the national average in 2003. This year was chosen as it was the first year that Georgia started evaluating its state-wide mortality rate and considering the development of a state-wide system. In 2003, Georgia’s age-adjusted trauma mortality rate was 16% above the national average (65/100,000 vs. 56/100,000).¹ By 2020, Georgia’s trauma mortality rate improved to 6% below the national average (76.11/100,000 vs. 80.83/100,000).¹ Had Georgia remained at 16% above the national average in 2020, however, we estimated the mortality rate would have been approximately 93.76 per 100,000. When applied to Georgia’s 2020 population of 10.7 million, that translates to 10,032 potential trauma-related deaths (10.7 million/100,000=107; 107×93.76=10,032). The actual number of trauma-related deaths in 2020 was 8,229.¹ This represents 1,803 fewer lives lost in 2020 than would have been expected if Georgia’s mortality rate had stayed on the same trajectory.

To calculate the economic impact of this reduction in mortality, the costs of this counterfactual scenario were determined using the same approach as was used to calculate Georgia’s actual trauma-related costs in 2020. Determining the lost lifetime potential personal income and the resultant lost state and local tax revenue requires observable data on under-65 YPLL, however. Since these additional 1803 patients did not actually die, we cannot determine the actual YPLL associated with their deaths. Given the lack of these required data, we were forced to estimate the economic costs of this counterfactual scenario. This took place in two ways: the first a more general overestimate and the second a more conservative approach using real-world data as a reference.

Estimated counterfactual data

Our first approach estimated the value based on a percent increase of 2020’s actual YPLL data. Since Georgia’s trauma mortality rate fell to 6% below the national average in 2020, the counterfactual under-65 YPLL would be 22% higher than 2020’s actual under-65 YPLL (6+16=22). We calculated this counterfactual under-65 YPLL to be 209,476 (171,702×1.22=209,476.44). We then multiplied this number by Georgia’s per-capita income to calculate the lost lifetime potential personal income that forms the basis for our cost calculations. Since this scenario assumes all increases in YPLL occurred in the under-65 cohort, however, the resulting mortality costs are an overestimate, representing a worst-case economic scenario. As the age-adjusted mortality rate increases, so too would the spread of mortality across all age groups—a 22% increase in the mortality rate would not necessarily mean a 22% increase in just the under-65 YPLL, as some of the increased mortality will undoubtedly take place among those over 65.

Lost Lifetime Potential Personal Income=YPLL×Per-Capita Income

Lost State and Local Tax Revenue=Personal Income State and Local Tax Rate

Disability-Associated Costs=2.2×Mortality Costs

Total Costs=Mortality Costs+Disability Costs

Illinois’ real-world 2020 data

To better ground our estimates, our second approach used real-world data sought out from 2020. Rather than determining the median age of Georgia’s trauma victims and calculating the resulting under-65 YPLL, we elected to seek out real-world data from a comparable population. Using the CDC’s WISQARS database, other states’ 2020 mortality rates were compared with Georgia. In a natural experiment, Illinois proves to be a useful comparison. Its age-adjusted trauma mortality rate was 76.08 in 2020 compared with Georgia’s 76.11 (meaning that its trauma victims are dying at just about the same ages), and the rest of its mortality trends closely mirror Georgia’s. Most importantly, Illinois suffered 10,023 trauma-related deaths, with an under-65 YPLL of 197,626.¹ If the same number of deaths had occurred in Georgia in 2020, it would produce a crude mortality rate of 93.67 (compared with our projected mortality rate of 93.76 if we had not improved). Offering real-world, comparable data to conservatively test our hypothesis, we applied the under-65 YPLL of Illinois in 2020 to Georgia’s economic context. The same approach as the previous two scenarios was used to calculate the costs to lifetime personal income and potential lifetime tax revenue which would have resulted.

Lost Lifetime Potential Personal Income=YPLL-IL×Per-Capita Income State

Lost State and Local Tax Revenue=Lost Lifetime Potential Personal Income×State and Local Tax Rate

Disability-Associated Costs=2.2×Mortality Costs

Total Costs=Mortality Costs+Disability Costs

To calculate the total economic impact of reducing mortality and disability, the actual costs of trauma in 2020 were compared with the counterfactual scenario calculated using Illinois’ data. The difference between the total lifetime potential income lost and the total state and local tax revenue for each scenario was taken.

Total Costs Averted=IL-Based Counterfactual Costs−State Actual Costs

The CHEERS guidelines were used to ensure proper reporting of methods, results, and discussion.

Results

Based on these methods, our calculations of mortality-associated costs, disability-associated costs, and total costs for each scenario appear in table 1. We calculated the actual cost of trauma mortality and disability in 2020 to have been $28,553,081,069 in lost lifetime potential personal income and $3,369,263,566 in lost state and local tax revenue. For our estimated counterfactual scenario, we calculated the cost of trauma mortality and disability to have been $34,834,685,734 in lost lifetime potential personal income and $4,110,492,916 in lost state and local tax revenue. In our real-world, data-based counterfactual scenario, we estimated the cost of trauma mortality and disability to be $32,864,097,088 in lost lifetime potential personal income and $3,877,963,456 in lost state and local tax revenue. The total economic impact of reduced mortality was calculated by subtracting Georgia’s actual costs of trauma in 2020 from the costs calculated for each counterfactual scenario. Since the economic impact arising from the real-world, data-based counterfactual scenario was more conservative, we have opted to make these results our focus. As shown in figure 1, we estimate that reduced mortality saved $4.31 billion in lifetime personal income and $508.7 million in state and local tax revenue.

Table 1. Results of calculations.

Dataset	Metric	Datapoint	Formula	Calculation	Result
Actual State 2020 Data	Mortality-associated costs	Lost lifetime personal income	YPLL×Per-Capita Income	171,702×51,967	$8,922,837,834
		Lost state and local tax revenue	Lost Personal Income×State and Local Tax Rate	8,922,837,834×0.118	$1,052,894,864
	Disability-associated costs	Lost lifetime personal income	2.2×Lost Lifetime Potential Personal Income (Mortality)	2.2×8,922,837,834	$19,630,243,235
		Lost state and local tax revenue	2.2×Lost State and Local Tax Revenue (Mortality)	2.2×1,052,894,864	$2,316,368,701
	Total costs	Lost lifetime personal income	Mortality-Associated Costs+Disability-Associated Costs	8,922,837,834+19,630,243,235	$28,553,081,069
		Lost state and local tax revenue		1,052,894,864+2,316,368,701	$3,369,263,566
CounterfactualState 2020 Data	Mortality-associated costs	Lost lifetime personal income	YPLL×Per-Capita Income	209,476×51,967	$10,885,839,292
		Lost state and local tax revenue	Lost Personal Income×State and Local Tax Rate	10,885,839,292×0.118	$1,284,529,036.46
	Disability-associated costs	Lost lifetime personal income	2.2×Lost Lifetime Potential Personal Income (Mortality)	2.2×10,885,839,292	$23,948,846,442
		Lost state and local tax revenue	2.2×Lost State and Local Tax Revenue (Mortality)	2.2×1,284,529,036	$2,825,963,880
	Total costs	Lost lifetime personal income	Mortality-Associated Costs+Disability-Associated Costs	10,885,839,292+23,948,846,442	$34,834,685,734
		Lost state and local tax revenue		1,284,529,036+2,825,963,880	$4,110,492,916
Real-World Data-Based Counterfactual 2020 Data	Mortality-associated costs	Lost lifetime personal income	YPLL×Per-Capita Income	197,626×51,967	$10,270,030,340
		Lost state and local tax revenue	Lost Personal Income×State and Local Tax Rate	10,270,030,340×0.118	$1,211,863,580
	Disability-associated costs	Lost lifetime personal income	2.2×Lost Lifetime Potential Personal Income (Mortality)	2.2×10,270,030,340	$22,594,066,748
		Lost state and local tax revenue	2.2×Lost State and Local Tax Revenue (Mortality)	2.2×1,211,863,580	$2,666,099,876
	Total costs	Lost lifetime personal income	Mortality-Associated Costs+Disability-Associated Costs	10,270,030,340+22,594,066,748	$32,864,097,088
		Lost state and local tax revenue		1,211,863,580+2,666,099,876	$3,877,963,456

All bolded values reflect organizing categories and total values

YPLL, years of potential life lost.

Figure 1. Amount of lifetime potential personal income and lifetime potential state and local tax preserved due to reduced mortality.

Discussion

While it is becoming more common to assess the economic impact of reduced mortality, it is not readily apparent in the literature that such assessments are commonly performed on trauma care. Most articles which perform such assessments are arguing for the establishment of state-level trauma systems.⁹ It is far rarer to find assessments of the benefits provided by existing trauma systems to taxpayers and state governments. Perhaps the best example of this comes from Maxson et al, who examined the Arkansas state trauma system and determined that reducing mortality resulted in savings of $186 million, a ninefold return on investment for taxpayers.¹⁰ We found similar results in our analysis, augmenting these results through the inclusion of disability and differentiating between tax revenue and personal income.

It is clear Georgia’s trauma mortality rate fell from 16% above the national average in 2003 to 6% below in 2020.¹ This reduction in mortality rate resulted in 1,803 fewer lives lost in 2020 compared with Georgia’s previous trajectory,¹ translating to $1.3 billion in lifetime personal income saved as a result of averted traumatic deaths and $2.9 billion in lifetime personal income saved as a result of averted severe disability, for a total of $4.3 billion. This also resulted in $158 million in preserved lifetime state and local tax revenues due to averted deaths and $349 million in preserved state and local tax revenues due to averted severe disability, totaling $508 million. Reduced trauma mortality results in a positive economic impact for both individuals and the state of Georgia.

While it is beyond the scope of this article to address the causes of this reduced mortality, what is clear is that this reduction and the resulting economic benefits have significant implications for states. Fewer lives are lost, with each of these potentially a productive worker, a dutiful consumer, and a loyal taxpayer, and such reductions are important for states’ coffers. The preservation of so much lifetime potential personal income is especially beneficial for Georgia, since it is particularly dependent on personal income taxes for its revenues, which accounted for 52% of its total tax collections ($12.4 billion) in 2020.⁴ Therefore, Georgia’s government would be wise to invest in further reducing trauma mortality, especially in high-risk populations such as young males dying from motor vehicle crashes, motorcycle crashes, and firearm violence.

To reduce trauma mortality, a number of policy levers can be pulled, ranging from improved enforcement of traffic laws to the creation of new organizations dedicated to trauma care. In Georgia, the high mortality rate relative to the national average in 2003 galvanized the State Legislature to take action. After years of careful study and discussion, Senate Bill 60 created the Georgia Trauma Care Network Commission in 2007, charging it to ‘establish, maintain, and administer a trauma center network to coordinate the best use of existing trauma facilities in this state and to direct patients to the best available facility for treatment of traumatic injury’, and ‘to act as the accountability mechanism for the entire Georgia trauma system, primarily overseeing the flow of funds from the Georgia Trauma Fund into the system.’¹¹

Since its creation, the Georgia Trauma Commission has worked diligently to develop a state trauma system. Through the work of the Commission and multiple stakeholders, the number of designated trauma centers in Georgia has more than doubled to 31, providing care to 93% of all severely injured patients in the state,^{9 12} a seat belt law has been enacted, sustainable funding has been achieved through the application of a super-speeder fine and fireworks excise tax, and a requirement has been added that Level I and Level II trauma centers achieve verification from the American College of Surgeons to receive state trauma funding. The Commission is the only area of legislation and funding in Georgia with a budget solely tied to trauma care at the state level and is directly accountable to the state to demonstrate that funding is resulting in improved outcomes.¹³ Its annual budget, $23 million in 2020, represents a clear investment on the part of Georgia’s government to reduce trauma mortality.

While there are many possible causes for Georgia’s reduced trauma mortality in 2020 that are beyond the scope of this article, and it is virtually impossible to know how much direct impact-specific interventions had, there is ample evidence that there may be a significant association between reduced mortality and the establishment of a state trauma system.¹⁴ It is reasonable, then, to assert that the economic benefits of reduced trauma mortality represent a substantial return on investment to Georgia for its investment in the Georgia Trauma Commission and the development of a more robust trauma system. Based on the positive economic returns of reduced mortality in 2020, we calculate that for every $1 Georgia invested in the Trauma Commission in 2020, $22.60 will potentially be returned to state and local governments in lifetime tax revenue and $191.51 potentially returned to individuals in the form of preserved lifetime potential personal income. Even if it were possible to perfectly assign causality to the economic returns of reduced mortality, the Commission would only need to be responsible for 5% of the reduction in 2020 to more than recoup all investments made by Georgia that year.

The beneficial economic impact of trauma care is also important because the cost of trauma center development and maintenance is incredibly expensive. One of the responsibilities of the Trauma Commission is to provide funding for readiness costs for trauma centers. Therefore, readiness costs have been a significant point of research for the Commission during the last decade. Currently, the cost of trauma center readiness has been reported to be $10 million for a Level I, $4.9 million for a Level II,¹⁵ $1.8 million for a Level III, and $81,000 for a Level IV.¹⁶ The total readiness cost for all trauma centers in Georgia is thus $124 million.^{15 16} These are staggering numbers. However, when comparing the economic impact and return in the form of state tax revenue preservation, these numbers are more than paid for through a substantial, positive return on investment.

Practical applications

While our analysis has been retrospective, focusing on the results of reduced mortality, it can also be used as a prospective template for future system development. For example, a state could work to establish a new program or system to potentially reduce trauma mortality and use our methodology to project the preservation of personal income and state tax revenue which would result from any reductions in mortality. Such data could then be taken to a state legislature to support a request for funding. Since reducing trauma mortality, regardless of the means, leads to increased lifetime potential personal income and increased lifetime potential state and local tax revenue, we assert that the conversation around trauma care should emphasize the idea that dollars spent on trauma care are an investment, and not a cost. Our methodology empowers trauma care advocates to show state legislators and policy makers the potential economic returns from investing in new programs and policies which may reduce trauma mortality or evaluate return on investment of current programs. Likewise, these data offer a path to expand public awareness of the benefits of trauma care and to educate the public on the high costs of not investing in trauma systems.

Limitations

As with all studies, our analysis has limitations and relies on a number of assumptions to draw our conclusions.

Our assumptions

1. During their productive years, at least some trauma victims are gainfully employed and earning wages. However, we recognize that some individuals are earning far higher wages than others, and some are not earning anything. As such, we have opted to use the average per-capita income for our calculations.

2. Mortality rates can be used as a marker for the number of individuals left disabled by their trauma.

3. Severely disabled individuals suffer the same YPLL as if they had died. While this is likely not the case, it does account for loss of productivity and wages, associated costs of care and government support, and the impact of disability on earning potential. Thus, the presented disability costs represent a worst-case scenario for the economy. However, this worst-case scenario still does not most likely cover all of the knock-on costs of trauma-related disability. These include lower overall quality of life, underemployment, and altered household earnings, such as spouses or parents having to limit their work hours to provide home care. We were unable to identify these granular costs in the current database.

4. Incomes and tax rates do not change over time. Given that real incomes have historically risen over time (even accounting for recent, pandemic-related reductions due to spikes of inflation) and that tax rates generally adjust to account for this, this assumption serves to make our analysis more conservative by underestimating lifetime personal income and lifetime tax revenue. Additionally, if we adjust for inflation in 2024 dollars using the US Bureau of Labor Statistics Consumer Price Index, our estimated results would be even higher: $5.9 billion in lifetime potential personal income preserved and $705 million in lifetime potential state and local tax revenue preserved.¹⁷

5. No income or economic productivity occurs after the age of 65. This is not commonly reflective of reality, as many individuals continue to work past 65, participate in the economy, and pay taxes, but it allows us to more conservatively estimate our results.

Confounding factors

These assumptions and our analysis are limited by a number of potentially confounding factors, however. A lack of data in some areas and the sheer complexity of the healthcare system in Georgia mean that even the best attempts to assess the cost of trauma and the benefits of trauma care are rife with potential contradictions and oversights. We recognize that our assessment is narrow, and that a number of variables may have been overlooked or not incorporated. However, this is one way to analyze the data that are conservative and reproducible with readily available data.

The first major set of confounding factors involves the nuances and complicated, often subjective, nature of disability. To establish some form of model simplicity, Assumption 3 was made. This neglects partial disability, which does enable some participation in the labor force. In 2020, only about 500,000 of the nearly 1.3 million Georgia residents classified as disabled by the Census Bureau were receiving government disability assistance from Social Security, marking them as totally ineligible for work, while 24% of all disabled Georgia residents over the age of 16 (roughly 300,000 people) are employed, implying only partial disability.^{18 19} A lack of information about the status of the roughly 500,000 Georgia residents receiving worker’s compensation also adds variability to disability severity rates. Furthermore, given that 12.5% of Georgia’s residents were classified as disabled in 2020, there is a possibility that some trauma survivors could already be disabled.¹⁹

There is no gold standard for the ratio of severe disability to mortality. We calculated our 2.2:1 ratio using the results of four peer-reviewed studies, but we recognize that some might think our ratio is too high. Even if the ratio of severe disability to mortality is significantly lower than our estimate, however, it does not change the ultimate conclusion of the study. For example, if we used a ratio of 0.5 instead of 2.2, the return on investment drops from $22.60 to $7.94—still a significant return. Ultimately, this analysis is confounded due to a paucity of reliable data on disability rates by cause, as this limits our ability to accurately estimate the prevalence of severe disability as a result of trauma.

The other major set of confounding factors revolves around the difficulty of assessing a counterfactual situation. One cannot directly compare what actually happened to what did not happen, forcing the substitution of other datapoints as proxy. Since our examined patients did not die, we lacked the required data on YPLL, and thus turned to Illinois as such a proxy. These datapoints may not necessarily line up one to one with the original population, resulting in potential variances. Although the mortality statistics of Illinois in 2020 are very similar to Georgia’s, enabling a reasonable comparison, they are not exactly the same. Regardless, Illinois’ data are the best candidate of all other states in 2020 for comparison and most closely match our counterfactual predictions.

Conclusion

Reduced state trauma mortality and disability substantially benefitted lifetime potential personal income and lifetime potential state and local tax revenue. While our analysis has been retrospective, it can also be used as a prospective template for future system development. Our methodology empowers trauma care advocates to show state legislators and policy makers the potential economic returns from investing in programs and policies which reduce trauma mortality. While the causes of reduced mortality are manifold, anything that can be done to reduce trauma mortality is a worthwhile investment. Accordingly, state trauma system funding should be considered an investment, not a cost.

Data availability statement

Data are available in a public, open access repository.